The Hindu Business Line : OVL inks pact to operate 2 Cuban blocks

ONGC's overseas investment arm, ONGC Videsh Ltd (OVL), has entered into production sharing contracts (PSCs) with CUPET, the State oil company of Cuba, for two offshore exploration blocks, N-34 and N-35.

According to a statement, the blocks are located in the Exclusive Economic Zone of Cuba.

Spread over 4,300 sq km, the blocks are in a very favourable geological set-up and are estimated to hold considerable hydrocarbon resources. The contracts were signed on September 9 at Havana.

OVL had earlier submitted expression of interest for these two blocks located in the deep waters of Cuba offshore and negotiated the PSCs, the statement said.

The Cuban Government has the option to take 20 per cent participating interest in these blocks. OVL will be the operator of the block.

The exploration period is spread over a period of six years in three phases, the statement added.

During the first phase of exploration, acquisition, processing and interpretation of seismic data would be carried out for identification of prospects.

In May, OVL had acquired 30 per cent participating interest in six exploratory blocks in offshore Cuba from Repsol YPF, which holds 40 per cent participating interest; 30 per cent participating interest is with by Norsk Hydro.

Mr R.S. Butola, Managing Director of OVL, who executed the contract on behalf of the company, said: "Cuba offers very promising exploration play and OVL is very pleased to enhance its investments in the country. Besides, execution of the production sharing contract for the Blocks N-34 & N-35 marks the entry of OVL into Latin America as an operator, which will give a fillip to its activities in the region."